Tag Archives: potash

Anglo American continues SBR-led shaft sinking progress at Woodsmith

While Anglo American continues with its detailed technical review of the Woodsmith polyhalite project in the UK, shaft sinking activities at the asset continue to progress, the company confirmed in an investor update today.

The project was acquired by Anglo American in 2020 with the purchase of Sirius Minerals. Since then, Anglo American has been working on refining the development pathway and overall production potential of the asset.

In an investor presentation today, the company outlined physical progress on the site, explaining that shaft sinking for the circa-1.6-km deep service shaft had progressed to the circa-265-m level. It also said the mineral transport shaft, which it is working on with Redpath Group as sinking contractor, had reached the circa-230-m level of a planned 321-m depth.

Regarding horizontal development, it added that the 37-km mineral transport tunnel – which will connect to the mineral transport shaft – had reached the 20-km development mark with tunnel boring machine technology.

The Woodsmith project overview includes the sinking of production and service shafts with 6.75-m diameters – having depths of 1,594 m and 1,565 m, respectively – and the 37-km-long concrete-lined tunnel containing a conveyor belt, which transports the polyhalite ore from Woodsmith mine, near Whitby, to the Mineral Handling Facility, on Teesside, for processing and shipping.

Both the service shaft and production shaft at Woodsmith are being sunk using Herrenknecht’s Shaft Boring Roadheader technology, which has previously featured on the Jansen potash project in Saskatchewan, Canada, where it excavated two 8-11 m diameter blind shafts down to circa-1,000-m-depth and the Slavkaliy-owned Nezhinsky potash project, where it ended up breaking shaft sinking records under the guidance of contractor Redpath Deilmann on a project to sink two 8-m diameter shafts (one to 750-m depth and one to 697-m depth).

The first cut for the service shaft was made in July 2021, with Anglo American and Redpath Deilmann – which is now leading the sinking project as shaft sinking contractor – restarting sinking activities on this shaft earlier this year.

In the same investor presentation issued today, Anglo American said it planned to start sinking in the production shaft in the March quarter of 2023.

While the ongoing review takes place, Anglo American confirmed it had approved $800 million of capital expenditure for Woodsmith next year, focused on shaft sinking and other critical infrastructure as part of its phased approach to the asset.

Stephen Pearce, Finance Director of Anglo American, said on Woodsmith: “As we have said for some time, we are improving the project’s configuration to ensure we realise the full commercial value over the expected multi-decade asset life. This will extend the development schedule and the capital budget, compared to what was anticipated prior to our ownership, and so potentially impact our carrying value of Woodsmith for accounting purposes at the year end.

“Looking ahead, we are even more positive today about the prospects for Woodsmith and its potential to become a high margin, major contributor to our diversified product portfolio given the outstanding nature of the resource and the premium pricing upside we expect to realise for Poly4 – the highly effective, low carbon fertiliser we will produce.”

Ampcontrol to provide iMAC conveyor control systems to BHP at Jansen potash project

Ampcontrol says it has been named the supplier for conveyor control systems for Stage 1 at the BHP Jansen potash project in Saskatchewan, Canada.

The Ampcontrol iMAC monitoring and control system has achieved Canadian Standards Approval and will be used for conveyor controls on site, the company said, adding that this marks the first time an Ampcontrol product has been used in Canada.

Ampcontrol Managing Director & CEO, Rod Henderson, said: “We have a solid history of working with BHP in Australia for over 50 years. We are looking forward to furthering our relationship by participating in the Jansen potash project and are eager to share our world-class electrical solutions with the broader Canadian market.”

Designed to maximise productivity while maintaining the highest level of safety, the Ampcontrol iMAC system is customised to the unique requirements of sites and provides features such as high integrity emergency stop, broadcast messaging, and belt hazard identification functionality, with remote interface capabilities.

Jamie Scheffer, Integrated Project Team Manager Underground BHP, said: “Ampcontrol was selected from a number of different vendors to supply conveyor control signal line equipment for the underground conveyor systems, consisting of upwards of 35 km of conveyor belts.

“The Ampcontrol iMAC was the successful solution because it provided a remote interface which gave us the ability to link in remotely and help fault find should issues occur. This is particularly important for this site due to our remote location.”

BHP has announced an investment of $5.7 billion in the Jansen Stage 1 project, which is 140 km east of Saskatoon.

Work will start on the conveyor system in late 2022 with the current project expected to be completed by 2025.

Normet to supply battery-electric utility vehicle fleet to BHPs Jansen mine

Normet Canada says it has been awarded a contract from BHP to deliver a large fleet of multi-use battery-electric vehicles (BEV) to the Jansen potash project in Saskatchewan, Canada.

The delivery period of the fleet is expected to commence in the March quarter 2023 and extends to 2024.

The Normet fleet order follows on from Sandvik Mining and Rock Solutions being awarded a contract by BHP to deliver 10 underground battery-electric loaders along with 1 electric tethered loader for use at Jansen.

BHP aims to develop the underground mining equipment and automation solutions with a focus on sustainability, with emissions reduction, improved productivity and advanced health and welfare of employees being key inputs to the mining company’s decision to adopt BEV technology.

With the mine’s pursuit of electrification of mobile equipment and technology that mitigates natural gas emission, Jansen is expected to emit about half the average CO2 per tonne of product compared with the average Saskatchewan potash mine, according to BHP.

The Jansen project has the potential to be the largest potash-producing mine in the world and is expected to operate for up to 100 years, providing a rich source of potassium for soil fertilisation purposes and hence supporting food production, BHP says. Start of the production is targeted for 2026.

Woodsmith Shaft Boring Roadheaders about to re-start cutting process

One of the most-watched shaft sinking projects in the sector right now is located in the UK, with the Woodsmith project in north Yorkshire having been on the radar for a number of reasons.

First off, it is a project that has changed hands recently.

Originally guided by Sirius Minerals, the 10 Mt/y project was acquired by Anglo American in 2020, a transaction that came with a fresh look at the whole project execution phase.

The change in ownership and re-assessment of plans drawn up by Sirius – a much smaller company guided by different investor pressures and operating procedures – led to Anglo American relieving DMC Mining, the lead shaft sinking contractor, of its duties.

Another reason for watching the project is the planned use of Shaft Boring Roadheader (SBR) technology from Herrenknecht.

After debuting at the Jansen potash project in Saskatchewan, Canada, where it excavated two 8-11 m diameter blind shafts down to circa-1,000-m-depth with the help of DMC as the contractor, SBR 2.0 – the second generation of the technology – was put to the test in Belarus at the Slavkaliy-owned Nezhinsky potash project. It ended up breaking shaft sinking records under the guidance of contractor Redpath Deilmann on a project to sink two 8-m diameter shafts (one to 750-m depth and one to 697-m depth).

Herrenknecht, with its experience in mechanised tunnelling, developed the SBR for the mechanised sinking of blind shafts in soft-to-medium rock. Based on the proven technology of the Herrenknecht Vertical Shaft Sinking Machine, the SBR offers improved safety performance compared with conventional shaft sinking methods while also achieving higher advance rates, according to the company.

The SBR is a 60-m tall, suspended shaft sinking machine, with 12 work decks and two service platforms. A telescopic, boom-mounted cutting head is used to precisely excavate rock via a partial-face cutting method. The cutting head works in a cycle, starting each cut from shaft centre to shaft wall, repeating until a layer of material is removed. Excavation proceeds in 1-m increments, followed by SBR lowering sequences.

The SBR was chosen for Woodsmith by Sirius over the conventional drill and blasting method due to its advantages in improving safety and schedule. This methodology, Sirius said, would allow the company to satisfy several operational objectives, moving away from the use of explosives and providing a safer, more predictable work method. Instead of a linear process, the SBR allows work to be completed concurrently as the shaft is sunk, as well as minimising damage to exposed host rock, and further improving safety while minimising downtime. Work decks above the cutting head allow workers to install shaft lining and tubbing as excavation continues, while a pneumatic mucking system removes waste rock.

The third generation of technology – which builds on the first two deployments with, among other things, the addition of two retractable robotic probes to test and grout the ground ahead for safer excavation and an additional control cabin on surface for more remote operation – is due to sink production and service shafts with 6.75-m diameters to depths of 1,594 m and 1,565 m, respectively, at Woodsmith based on the Sirius plan.

These SBRs are being supported by four triple sheaved winches from SMS SIEMAG and conveyors from Herrenknecht-owned H + E Logistik GmbH, among other support equipment.

Work on the service shaft commenced in 2021 with former Anglo American Chief Executive, Mark Cutifani, confirming in July of that year that the “first cut” with the SBR had taken place in the service shaft.

This progress was made while the company was still completing a detailed technical review on Woodsmith to ensure the technical and commercial integrity of the full scope of its design. This review has a particular focus on the sinking of the two main shafts, the development of the underground mining area, and the changes required to accommodate both increased production capacity and the more efficient and scalable mining method of using only continuous miners, Anglo American said.

Since the first cut was made in July 2021, however, Anglo American and Redpath Deilmann – which is now leading the sinking project as shaft sinking contractor – have been reviewing the existing plans for sinking with the SBRs, carrying out minor hardware changes on the machines and ensuring all staff have the appropriate training to facilitate the completion of the shaft sinking process. The Redpath Group is also involved in the drill-and-blast-based sinking for the materials transport system (MTS) shaft.

Various shaft sinking rates have been mooted in the past at Woodsmith, and Anglo American is currently working to develop the optimal solution for the facility based on technical standards.

The sinking at Woodsmith represents a different challenge to the two previous SBR projects conducted to this point.

For starters, there is no ground freezing expected to take place at Woodsmith – unlike what happened in Canada and Belarus. This process, while time consuming and only used to freeze unstable water-bearing strata around the shaft, can create more rock uniformity to aide consistent cutting rates.

There is also the MTS level to consider at Woodsmith, with plans to carry out lateral development work around the 360-m-level to join up the production shaft with this level where polyhalite ore will be transported along a 37-km tunnel to Wilton near the port. This means vertical cutting and loading may be halted while the MTS level connection is established.

All these factors, along with the performance of previous SBR work, will be incorporated into the engineering work Anglo American is carrying out at Woodsmith, but, in terms of the SBR, signs are that work on the service shaft could recommence shortly, with plans to start sinking in the production shaft by the end of the year.

Emmerson selects Barr Engineering to build Khemisset mineral processing facility

Emmerson plc has awarded the first basic engineering contract for its Khemisset potash project in Morocco, with Barr Engineering set to build out the project’s mineral processing facility.

The company is moving into the pre-construction phase of development at Khemisset, which has a large JORC resource estimate of 537 Mt at 9.24% K2O. The recently feasibility study, completed by Golder Associates, outlined a project able to produce some 810,000 t/y of K60 muriate of potash during steady-state operations over the initial 19-year mine life.

The contract with Barr Engineering, an engineering and consulting firm headquartered in the US, was signed on time and within budget. It has been prioritised to address the project’s critical path focused on achieving first production in early 2024.

Emmerson expects to select the further contractor(s) for the balance of basic engineering before the end of 2021, signing contract(s) before the end of January 2022.

Graham Clarke, CEO, said: “The financing deal we secured with GSM and GQC included an upfront cash injection so that we could advance the next stage of the project’s development, the basic engineering. This is part of the upfront capital expenditure, rather than an additional cost, and moves us firmly into the pre-construction phase.

“Having already signed the contract with Barr Engineering for the mineral processing facility, we have also received bids for the balance of the basic engineering aspects of the project, comprising highways connection and site access; portal and declines; mine site infrastructure; tailings storage facility; electrical power; and water. We expect to be able sign contracts for these before the end of January 2022 so that this work can be dual tracked with the due diligence phase of the lending banks syndicate.”

SIEMAG TECBERG to supply hoisting system for new shaft at EuroChem’s Usolskiy

SIEMAG TECBERG and a subsidiary of EuroChem have signed agreements for the delivery of shaft hoisting systems at the Usolskiy potash complex in Perm, Russia.

This complex is built around Verkhnekamskoe, one of the world‘s largest potash deposits.

One expansion phase of the Usolskiy complex includes the already started construction of a third production shaft (Usolskiy Shaft No. 3) with a depth of 511.7 m as well as a further treatment system.

The present agreement requires SIEMAG TECBERG to undertake the engineering, production, delivery, supervision of assembly and commissioning of the following equipment:

  • Shaft hoisting systems for raw material extraction;
  • Double-drum winding machine, diameter 6 m, for skip extraction with a drive capacity of 4.55 MW designed for an annual hoisting capacity of up to 4.2 Mt. Sliding bearings with bearing lubrication, a type SB1 hydraulic braking system, rope sheaves for deflection, as well as automation and signalling equipment complete this shaft hoisting system package;
  • Hoisting equipment in the form of raw-material containers for shaft hoisting;
  • Loading stations on two levels underground;
  • Two rope deflection sheaves, diameter 6 m;
  • Shaft hoisting systems for personnel and equipment;
  • One-rope drum hoisting machine, diameter 3.6 m, for cage hoisting with one gearbox and an overall drive capacity of 1.5 MW (2 x 750 kW), including rolling bearings, a type SB1 hydraulic braking system together with automation and signalling equipment as well as a rope sheave for deflection;
  • Hoisting means (one-stage cage) with 10 t payload;
  • Two cage arresting devices;
  • Equipment for rope changing; and
  • Reeling winch, including accessories.

In the recently expanded TECBERG park, SIEMAG TECBERG is carrying out all the necessary work to ensure efficient assembly/installation and final commissioning on site. This includes complete functional assembly/installation of the equipment together with extensive system tests on drive test stands as well as pre-commissioning with all pre-settings, it said.

SIEMAG TECBERG’s “Logistics & Certification Competence for the CIS” also helps the customer achieve the fastest possible and problem-free registration and transfer of the equipment to its stock of capital equipment under official supervision.

After commissioning of the systems, the team at Usolskiy will be supported on site with the necessary spare parts, plus maintenance of the delivered equipment by qualified SIEMAG TECBERG personnel from the local service branch and storage facility at Berezniki in the Perm region.

Pictured is the Complex of Usolskiy Shaft No. 3 in (© Eurochem. Image use with kind permission.)

BHP greenlights Jansen Stage 1 potash project

BHP has approved $5.7 billion in capital expenditure for the Jansen Stage 1 (Jansen S1) potash project in the province of Saskatchewan, Canada.

Jansen S1 is expected to produce approximately 4.35 Mt/y of potash, and has a basin position with the potential for further expansions (subject to studies and approvals), according to BHP. First ore is targeted in 2027, with construction expected to take approximately six years, followed by a ramp-up period of two years.

Jansen S1 includes the design, engineering and construction of an underground potash mine and surface infrastructure including a processing facility, a product storage building and a continuous automated rail loading system. Jansen S1 product will be shipped to export markets through Westshore, in Delta, British Columbia, and the project includes funding for the required port infrastructure. This infrastructure will be constructed by Westshore Terminals Investment Corporation as part of an agreement with BHP.

BHP Chief Executive Officer, Mike Henry, said Jansen is aligned with BHP’s strategy of growing the company’s exposure to future-facing commodities in world-class assets, which are large, low cost and expandable.

“This is an important milestone for BHP and an investment in a new commodity that we believe will create value for shareholders for generations,” Henry said.

“In addition to its merits as a stand-alone project, Jansen also brings with it a series of high returning growth options in an attractive investment jurisdiction. In developing the Jansen project, BHP has had ongoing positive engagement and collaboration with First Nations and local communities, and with the provincial and federal governments. Jansen is designed with a focus on sustainability, including being designed for low greenhouse gas emissions and low water consumption.

“We anticipate that demand growth will progressively absorb the excess capacity currently present in the industry, with opportunity for new supply expected by the late 2020s or early 2030s. That is broadly aligned with the expected timing of first production from Jansen.”

BHP said: “Beyond the 2020s, the industry’s long run trend prices are expected to be determined by Canadian greenfield solution mines. In addition to consuming more energy and water than conventional mines like Jansen, solution mines tend to have higher operating costs and higher sustaining capital requirements.”

At consensus prices, the go-forward investment on Jansen is expected to generate an internal rate of return of 12-14%, an expected payback period of seven years from first production and an underlying EBITDA margin of around 70% given its expected first quartile cost position, according to BHP.

BHP says the $4.5 billion (pre-tax) of capital invested to date has resulted in a significant initial outlay. The investment to date includes construction of the shafts and associated infrastructure ($2.97 billion scope of work), as well as engineering and procurement activities and preparation works related to Jansen S1 underground infrastructure. Approximately $220 million of the $2.97 billion approved for the current scope of work, expected to be completed in 2022, is not yet spent.

The construction of two shafts and associated infrastructure at the site is 93% complete and expected to be completed in 2022, with Cementation Canada set to carry out the post liner excavation, steel and equipping of the shafts.

The sinking of the shafts was carried out by DMC Mining Services using Herrenknecht’s Shaft Boring Roadheader.

To date about 50% of all engineering required for Jansen S1 has been completed, significantly de-risking the project, BHP says.

Nutrien to boost potash output from ‘low-cost’ mine network

Nutrien Ltd has increased its first-half 2021 earnings guidance given the strength in global fertiliser markets and strong operational results.

First-half 2021 adjusted net earnings per share is expected to be C$2.30-2.50 ($1.86-2.02), up significantly from previous guidance of $2.00 to $2.20, it said.

In response to continued tightening in global potash market conditions, Nutrien says it is flexing its “low-cost network” of six mines to draw upon its available capacity in a timely manner, planning to produce a further 0.5 Mt of potash, in addition to the 0.5 Mt increase announced on June 7, 2021.

“As a result, we now expect to produce 1 Mt of incremental potash in 2021 compared to expectations earlier this year,” the company said.

The majority of the increased production is expected to occur in the December quarter, with some of these additional tonnes expected to be sold in early 2022.

The company’s updated guidance for potash sales volumes in 2021 is 13.3-13.8 Mt, which would exceed the company’s previous record high for annual sales volumes of 13 Mt set in 2018.

Mayo Schmidt, Nutrien’s President and CEO, said: “The quality and breadth of our integrated network, combined with unparalleled expertise in potash mining and an exceptional transportation and logistics system, helps ensure our customers have the crop inputs they need to feed a growing world and drives tremendous shareholder value. With continued strength in global agriculture and crop input markets, we are raising guidance and expanding our potash production by a total of 1 Mt to ensure farmer’s get the potash they need.”

BCI Minerals signs up WHBO Infrastructure, Engenium for Mardie work

BCI Minerals Limited has confirmed around A$90 million ($68 million) of contract awards for its Mardie Salt & Potash project, in Western Australia, ahead of a final investment decision (FID).

The initial earthworks contract has been awarded to WBHO Infrastructure, a contractor with a long history of project delivery excellence in large civil construction projects and a strong presence in Western Australia.

The contract includes initial construction of the large-scale trial pond scheduled to commence in April, as well as construction of evaporation ponds 1 and 2, on terms aligned with definitive feasibility study (DFS) budget assumptions once the FID is achieved and required tenure and approvals are in place. The total earthworks volume in this scope is approximately 800,000 cu.m over an area of 24 sq.km.

Engenium, the successful tenderer for the Project Management Contractor role, is a Western Australian company with offices in Perth and Karratha. Engenium, which recently signed a letter of intent that could see it acquired by Stantec, was selected for its local and experienced team, proven track record in project delivery and construction management, excellent health and safety record and pricing within the DFS budget, BCI said.

“The PMC is an important contract in the overall execution of the Mardie project which will see Engenium manage the construction program through the provision of people and systems as an extension of the BCI owners’ team,” it said. “Engagement of Engenium on a staged basis will also support BCI to achieve construction-ready status ahead of main construction commencing in the second half of 2021.”

Various smaller contracts covering accommodation village expansion, minor earthworks, site surveys, communications, water supply, fuel storage and supply as well as the Karratha office fit-out have also been awarded this year. These works are all underway with Pilbara-based contractors expanding Mardie village and fitting-out the Karratha office and local indigenous companies carrying out aboriginal heritage surveys and minor earthworks.

BCI’s Managing Director, Alwyn Vorster, said: “The award of the initial earthworks contract, in particular, represents a key milestone in BCI’s progress toward main construction and demonstrates board confidence in Mardie’s development pathway. These contracts will be initially funded from BCI’s healthy cash balance and strong Iron Valley royalty income.”

The Mardie DFS outcomes indicated that the production of 4.4 Mt/y of high purity salt and 120,000 t/y of premium sulphate of potash (SOP) fertiliser was technically and financially viable. The total capital cost came in at A$779 million and the pre-tax net present value (7% discount) was A$1.197 billion.

A FID by the BCI Board is targeted in the June quarter, which will be followed by completion of the funding task. Construction could commence in mid-2021, which will allow for first salt sales in 2024 and first SOP sales in 2025, the company says.

Kore Potash and China’s SEPCO, ENFI to work on Kola potash optimisation study

Kore Potash and Summit Africa Ltd, on behalf of a consortium of investors and engineering firms, have signed a non-binding memorandum of understanding (MoU) to arrange the total financing required for the construction of the Kola potash project in the Republic of Congo.

The MoU with Summit outlines a roadmap to optimise, fully finance and construct Kola via a mix of debt and royalty financing, it said.

Summit and its technical partners, SEPCO Electric Power Construction Corp and China ENFI Engineering Corp, who has been subcontracted by SEPCO, will work with Kore to undertake an optimisation study to reduce Kola’s capital cost with a target of less than $1.65 billion.

Kore, which owns 97% of Kola, will contribute around $900,000 to the optimisation study costs, with SEPCO covering the remaining 50% of the estimated study costs, it said.

Summit is an Africa-focused strategic advisory, corporate finance and alternative investment group headquartered in Mauritius who, in 2016, led and arranged the $50 million financing of the definitive feasibility study for Kola. As part of that financing, both the Oman Investment Authority (then called the State General Reserve Fund) and Sociedad Quimica y Minera de Chile (SQM) each invested $20 million.

Summit’s role in the MoU is to, again, be the lead arranger and to advise the company concerning the most optimal financing solution that would see the delivery of the Kola project, Kore said.

SEPCO will be the engineering procurement and construction contractor for Kola within the Summit consortium. ENFI’s potash-specific experience includes design and construction of an underground potash mine in Southeast Asia.

Summit, SEPCO and ENFI commenced discussions with the company towards financing the construction of Kola in the second half of 2019.

The MoU provides the Summit consortium with a nine-month period to present a financing proposal to fully finance the construction of Kola via a combination of debt and royalty financing. This means the company would not be required to raise equity to fund the capital cost of construction as the equity portion will be covered by the royalty funding with the company retaining its 90% interest in the project (the Republic of Congo Government receiving the remaining 10%).

The results of the definitive feasibility study for Kola were announced in January 2019. During its review of the DFS, the company and its independent consultants identified several opportunities to achieve a material reduction in the capital cost of Kola, but the realisation of these opportunities requires further capital optimisation studies, it said.

“Having already completed a preliminary review of the DFS and the potential optimisation opportunities identified, the technical partners in the Summit consortium (SEPCO and ENFI) have confirmed a target capital cost for the optimisation study of $1.65 billion,” Kore said. “Reducing the capital cost of Kola will reduce the size of the financing required for construction and improve returns for the company’s shareholders. The Summit consortium has set out in the MoU that achieving the target capital expenditure in the optimisation study is a condition for Kore to receive the financing proposal.”

Kola is a high grade, high quality, shallow sylvinite potash deposit situated on an existing mining licence, approximately 35 km from the coast, and 65 km north of the harbour city of Pointe Noire, Kore says. It comes with a 2.2 Mt/y muriate of potash production profile over a 33-year mine life.

The permitting and agreements required for construction are in place including the environmental permit, trans-shipment permit and the Mining Convention with the government.

Once in production, Kola is anticipated to be one of the lowest cost potash producers globally, ideally located to supply nearby African and South American markets, the company added.